The Work of the Supervision
Function at the SRA
Suki Gill – Manager
Sue Heads – Team Leader
2 October 2014
Our Purpose
• To protect consumers of legal services; and
• Support the operation of the rule of law and
the proper administration of justice.
Who do we regulate?
• Solicitors – 163,015 on the Roll of which 130,812 have
Practising Certificates
• Registered European lawyers, registered foreign lawyers, and
exempt European lawyers – 4904
• Around 11,300 firms authorised by the SRA, diverse range of
firm type, size, turnover and profitability
• All owners, managers and employers of SRA regulated firms
• All these individuals need to comply with the requirements of
the Handbook
Supervision
• Supervision directorate of over 100 staff
based in Birmingham and London
• Broken down into:
– Firm – based Supervision
– Thematic Supervision
– Regulatory Management
Supervising firms
• Building a different relationship with firms, where firms are
willing to engage with the SRA
• Firms take responsibility for compliance and for achieving the
right outcomes for consumers
• Delivering risk based, targeted and proportionate regulation
• Emphasising a proactive approach
Managing Risk
• The regulated community is constantly changing
and evolving, so supervision needs to be
responsive to:
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the risk a firm poses
its own management and mitigation of risk
its approach to, and history of, compliance
the level of constructive engagement with the SRA
Supervision Objectives
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Deal with all high risk matters in a timely manner
Respond effectively to the risk of financial instability
Identify and respond to potential interventions
Progress major investigations and conduct issues
Respond to the risks posed by bogus firms
Increase active engagement with firms
– Thematic Work
• Impact of Legal Aid Reforms
• The provision of advice in Asylum cases
• Anti-Money Laundering and financial crime
• Failure to cooperate with the regulator
• Dispersed firms
What concerns us most
• Top five risks to the regulatory objectives:
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Misuse of client money or assets
Bogus firms
Lack of diverse and representative profession
Failure to provide a proper standard of service
Money laundering - Inadequate systems and controls
over the transfer of money
Supervisory approach & tools
• Engagement and investigation are not mutually exclusive
• Our approach distinguishes between those firms that want to
engage with us, and those that will not or cannot.
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Desk based engagement and visits
Compliance plans
Conditions on PCs, ownership and authorisation
Regulatory Settlement Agreements
Disciplinary outcomes – rebukes, fine, publication
Referrals to the SDT
Intervention
SRA enforcement :
constructive ways to respond
PAUL MILTON
Case Manager, Legal & Enforcement
2 October 2014
How do we enforce?
• Based on our published enforcement strategy
• Encourages engagement with those who work with us to
put things right but strong action where firms do not cooperate or where serious issues arise
• Engagement is important even where disciplinary action
taken
• At heart: risk-based protection of public interest and
credible deterrence
Enforcement tools
• Obtaining documents and information
• Conditions on Practising Certificates, ownership and
authorisation
• Internal Disciplinary sanctions – rebukes and fines
• Referral to Solicitors Disciplinary Tribunal
• Regulatory Settlement Agreements
• Intervention
Constructive Responses to
Enforcement Action
• Seek independent expert legal advice early on
• Tell us sooner rather than later which facts and
allegations are admitted; explain clearly reasons for
denials
• Continue to narrow the issues
• Take any remedial steps you can, especially to improve
clients’ positions
• If possible arrange to have legal representation at SDT
hearing
Regulatory Settlement
Agreements
• Policy on RSAs is on our web site:
– www.sra.org.uk/sra/how-we-work/decision-making/oldcritera/regulatory-settlement-agreement-decision-to-enterinto.page
• Regulatory decision accepted by the solicitor on agreed
terms
• Usually published for transparency
• Proportionate outcome achieved at reasonable cost in
the public interest
Regulatory Settlement
Agreements
The Agreement:
• Is in writing and signed by both parties
• States the facts
• Contains admissions of failures to achieve outcomes
• Identifies any remedial action to be taken
• Imposes sanction where appropriate
Possible terms of an RSA
• Agreed public statement
• Implementation of schemes for correction, improvement
and restitution
• Practising controls
• Removal from the Roll by consent
In summary
• OFR is all about protection of clients and the wider public
• Not all breaches require enforcement action
• Co-operation with the SRA is key - the sooner the better
but never too late!
• Even if enforcement action taken, still sometimes
possible to resolve by RSA/consent order or at least
agree a statement of facts to save time and costs
Sources of support
• SRA’s ethics helpline - 0870 606 2577
• Solicitors Assistance Scheme (SAS) for independent
advice - www.thesas.org.uk
• LawCare - advisory and support service for lawyers
(www.lawcare.org.uk telephone 0800 279 6888)
• Other networks and groups such as the Sole
Practitioners Group, The Society of Black Lawyers,
Lawyers with Disabilities Division, The Society of Asian
Lawyers and Association of Women Solicitors.
Material breaches
• Breaches that are 'material' must be reported to
the SRA as soon as reasonably practicable
• Mechanisms for reporting:
– [email protected]
• Factors to consider are :
– the detriment, or risk of detriment, to clients
– the extent of any risk of loss of confidence in the
firm or in the provision of legal services
– the scale of the issue
– the overall impact on the firm, its clients and third
parties
• Have confidence in your judgement